Back to Work: Budget Cuts Imperil Brooklyn’s Booming Health Care Business

Home Brooklyn Life Back to Work: Budget Cuts Imperil Brooklyn’s Booming Health Care Business

Many Brooklyn residents employ home health care aides. (The Associated Press)
Many Brooklyn residents employ home health care aides. (The Associated Press)

This is the second in an ongoing series about jobs in Brooklyn.

By Jeremy B. White

Brooklyn’s biggest industry is growing.

The state budget is shrinking.

Something will have to give.

Brooklyn’s healthcare and social assistance sector, a broad category that includes everything from home health aides to hospital workers to after school programs, employs some 30 percent of the borough. It also relies largely on government funding — from grants to nonprofits to Medicaid and Medicare reimbursements — to stay in business.

So Governor Andrew Cuomo’s aggressive moves to curtail state spending, coupled with imminent federal cuts, pose a serious dilemma. The fate of Brooklyn’s healthcare and social assistance industry is a microcosm for the debate roiling Congress: whether deficit reduction should come at the expense of subsidies that stimulate job growth.

Brooklyn’s healthcare and social assistance sector outpaced the borough’s other industries in 2009, adding 4,700 new jobs. The borough’s steadily rising population has augmented demand for services, particularly from the substantial number of elderly and high-need residents. Meanwhile, the most recent state budget slices almost $2 billion out of Medicaid. The borough’s upwards demographic trend is likely to continue as funding moves in the opposite direction.

Carl Hum, the Brooklyn Chamber of Commerce president, said the borough is in “a pretty unique position” for three main reasons: “A lot of our jobs come from the healthcare and social services industry. There still is a relatively high concentration of poverty in the borough. And the borough is getting increasingly more populous,” Hum said. “Those three factors together kind of cry out for increased support for entitlement programs.”

The vast majority of Brooklyn’s social assistance organizations are nonprofits. Allison Sesso, the deputy executive director of the nonprofit umbrella Human Services Council, said that these nonprofits get the bulk of their funding, between 80-90%, through public contracts.

“I think it means we’re moving towards more burdens on families trying to provide for their own,” Sesso said. “I think nonprofits are trying to do their best but they’ve been struggling for years.”

The Brooklyn Chamber of Commerce released a report in January predicting that Brooklyn’s hiring growth would continue to eclipse the rest of the city, fueled by more gains in healthcare and social assistance jobs. James Parrott, chief economist at the New York-based Fiscal Policy Institute and the report’s author, said that nonprofits typically “go to enormous lengths to try and preserve services.” As government support diminishes, providers will need to find ways to make up the shortfall.

“That’s not to say social assistance agencies are going to start substituting less skilled for more skilled workers,” Parrott said. “It means that the workers who are there are not going to see much in the way of wage increases or benefit increases.”

The lion’s share of growth comes from a surge in home health care aides, who represent a cheaper alternative to assisted living facilities for Brooklyn’s greying population. New York City has seen a larger increase in its elderly population than the rest of the country, with Brooklyn’s 382,000 elderly residents registering just behind Queens’ 385,000. Since 2000 Brooklyn’s home health care industry has grown at a 12.6 percent rate, compared to 7.8 for the rest of the city.

Home health care jobs do not require a high school degree or English proficiency, which has made them a steady source of employment for Brooklyn’s large immigrant population. The average annual pay for a home health care worker, about $29,000, falls short of the borough’s average private job income of $38,000, but that will change: during this year’s budget negotiations, Governor Andrew Cuomo rewarded the United Healthcare Workers union for supporting his Medicaid reform proposal by including a provision guaranteeing a living wage for home health aides.

The New York Association of Homes and Services for the Aging, a nonprofit advocate for elder care, slammed the requirement as an unfunded mandate that will increase the strain on home health care.

“The degree to which an organization utilizes home health aides dictates how much they’ll be affected by that,” said senior vice president Dan Heim. “But if it puts too much pressure on operating budgets it could have the perverse effect of reducing staffing, which could make them less able to provide services.”

Most of Brooklyn’s health care and social assistance organizations are facing a similar problem as they walk an increasingly narrow budgetary tightrope. Brooklynites will need senior centers and nurses in increasing numbers, but to pay for new workers organizations will need to cut costs. As the government scales back its contribution, employees may suffer.

“It’s a screwed up way to respond to widespread need in the wake of a terrible economic situation,” Parrott said. “It’s not conducive to decent longterm economic growth.”


With Brooklyn recovering from the economic crisis, we at the Ink decided to look at how residents of the borough who lost their jobs are beginning to recover.

Last week, we reported that jobs were starting to appear in the borough in fields like health and education, where more than 15,00 jobs were created since 2008. Fields like construction, finance, and manufacturing, though, may have been irreparably damaged.

In the days to come, we will also be telling the stories of people who have overcome the loss of a job and have reinvented themselves into new careers.

If you have a story you’d like to tell about your own reinvention, write to us at

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